DoLE steps in to avert strike in flag carrier

Plans of flag carrier Philippine Airlines (PAL) to lay off 3,000 workers and outsource three of its non-core units faced a hitch after the Department of Labor and Employment (DoLE) stepped in to prevent a strike. In a four-page order, Labor Secretary Marianito D. Roque assumed jurisdiction over a labor dispute between the airline and the PAL Employees’ Association (PALEA), noting a deadlock in mediation proceedings. This buys time for the 4,000-strong union. PAL had said it would terminate the services of workers by the end of May and would close three more units afterwards. "A strike in the company at this critical time cannot be tolerated as we are now hampered by the debilitating effects of the global recession. The series of job displacements and the projected job losses have made the government’s hands full in finding solutions and safety nets to cushion the negative impact of the crisis," said the order, dated April 23. Mr. Roque said he had to intervene to preserve the status quo as the dispute is "likely to cause a strike or lockout in an industry indispensable to the national interest such as the airline industry." PAL is outsourcing call center services, catering services and ground services. PALEA filed a notice of strike in January against the planned retrenchment of workers. Hearing set Gerardo F. Rivera, president of PALEA, told BusinessWorld an initial hearing has been set this Friday. "We received [Monday] the order of the DoLE that they will be assuming jurisdiction in the case. Certainly, we hope that the management does not file any appeal regarding this. There is a meeting set for April 30 and there we will continue to [demand that] the outsourcing [plan be] stopped," said Mr. Rivera. He added PALEA members are being issued notices of termination by the management, but they are refusing to receive them. PAL management declined to comment on the issue, saying yesterday that "as of this morning we have not received [a] copy of that order." Mr. Roque said he would no longer comment on the case since he is now the arbiter. The DoLE also noted that the assumption of jurisdiction will spare the public from a strike or lockout. Rene E. Ofreneo of the University of the Philippines School of Labor and Industrial Relations said in a telephone interview that the DoLE can assume jurisdiction over the PAL case even if there is no strike. "Under provision 263-G of the Labor Code, the DoLE can assume jurisdiction in a wide number of cases. This is actually quite common to assume jurisdiction to prevent a strike," said Mr. Ofreneo. PAL President and CEO Jaime J. Bautista told reporters last week that outsourcing is estimated to yield savings of P1 billion-P1.5 billion for the company and will make it more attractive to investors. PAL will be paying around P2 billion in benefits. Under the plan, retrenched employees will be given separation pay equal to one month’s salary for every year of service. -- BusinessWorld